BTM156: Mortgage Rates How It Really Works (Post COVID-19) with Aaron Chapman
This is Darriel aaliyah. And you're listening to the before the millions podcast episode one fifty six Cowabunga. Are you ready to be the master architect of Your Life? Are you ready to design your business and invest the needs that create? The lifestyle always dreamt up. Are you ready to learn from entrepreneurs and airs? Who have achieved a certain level of success. Hey this is Derek Location Independent Entrepreneur. And you're listening to the before the millions podcasts. I am Gina Lofton. I an investor. And you're listening to the before. The millions podcast. Hey there my name is. Heather Haven would marketing coach and global entrepreneur. And you are listening to the before the millions podcasts. Hey this is Marcus crispy host of the seven minute mental podcast global entrepreneur and all round Geek. And you are listening to the podcast am MC lobster the cash linenger and you're listening to before the million spot cost you're listening to the before the millions podcast or whether you're looking to invest we're cash flow all built an online business that allows you to be location independent. You come to the right place. Mr Hollywood himself presents the before the millions. Podcast now your host. What is going on people? Welcome back back to another episode of the before the millions podcast and have another fantastic guest for you today. His name is Mr Aaron Chapman. But before that if you having subscribed to this podcast be sure to hit. That subscribe button. And secondly if you haven't yet left a review be sure to head over to to Itunes or your podcast directory and make sure you leave a review for this podcast. Five stars are preferred. So let's get into today's episode because what we're talking about is the state of the market post-seaon nineteen things are kind of opening back. Up outside is being available again in small capacity so we want to talk about the real estate market and we'll talk about mortgage rates. We'll talk about is now a good time mortgage rates right now on average for conventional owner about five five and a half percent so is now a good time to lock in those rates. Are It's GONNA go back down or rates steadily GONNA rise up. All of that will be discussed on today's episode so theoretically speaking I went to go. Get this information directly from the Horse's mouth now. Today's guests mister. Aaron Chatman is a veteran with over twenty years of experience in the finance industry and as a loan originator and a sea of loan originators. I think the industry has over three hundred thousand lenders so just imagine. His company ranks number fourteen as a lender so with that kind of expertise in with his post on the financial markets. I wanted to do a deep dive with him on again. The future of interest rates and mortgages and how real estate investors should think about financing after the corona virus pandemic? So this is a fascinating episode. And we're going to get into here shortly. But if you're not already following me on instagram be sure to head over to before the millions dot com for slash instagram or just over two instagram and typing. My Name Guerrero. The and let's connect. Instagram is my platform of choice. Unlike facebook I can get a message and not see it for two three weeks. Maybe a month Lincoln. I can get a and not see it for a few months but a frequent instagram. A little bit more. Because that's why I post. My current books travels eateries things of that nature. And that's why I've been collecting a lot of the questions that I'm going to answer in an upcoming episode. So if you have any questions pretends to real estate as it pertains to your journey. Financial Freedom. Lifestyle designed being located independent again. Hit me up on instagram. Follow me on instagram. Let's connect let me see if I can help you get you to your goal so my instagram handle is again derail. Alya or if it makes it easier for you you could just head over to before. The millions dot com for slash instagram. So one last thing before we get into the show. Because I want to help you find some money from the type of money that you can find the your couch to the type of money that can maybe cover a car. No I'M GONNA. I sure you had to do that in the tip of the week and then we'll get to the show and figure out how Aaron was able to close over three thousand transactions in the past four years three thousand that's like an average of what like eight hundred transactions a year. That's insane but we're GONNA talk about exactly how Aaron did exactly that raised tip of the week. You know that feeling when you were a kid and you find a dollar on the floor and the playground or you know in the parking lot. I remember the last time this happened to me. And it hasn't happened since it was like when I was like sixteen or seventeen in high school I was walking out of basketball practice and I was walking to my car. Crossing the street. And Lo and behold right there in the dirt next some trees was like a five or ten dollar bill or might even been a twenty dollar bill. Because I remember how excited I got and I was just like. Oh m. g. and happened quite frequently when I was younger but since I've like turned eighteen. I haven't seen a single bill on the floor anywhere. Well that's again free money and I want to see if I can help you find some free money. I mean how about when you find some change in the couch. That's always a joyous time. I personally don't find changing the couch but I do find my own money in my pocket sometimes so anyways here's a way to search quote unquote the couch to see. If you have some change that composite we pay for your next meal or can possibly pay for your next will and the way I want you to do. This was actually recommended to me by one of my mastermind members. So here's what you do you type into your search bar on Google or whatever your search engine is and you type in unclaimed property and then your state so unclaimed property Texas or unclaimed property New York or unclaimed property California. And you go to the property site if you heard of this before you're like yeah yeah already know this but some of you have and basically these sites are set up for the state to help individuals cash in on funds that they're entitled to but for some reason or another they didn't yet receive. So maybe you moved and changed your mailing address but the company that was supposed to give you some money. So let's just say. At and T. Had a crazy because you overpaid your bill. And they sent it to your own address. Little things like that. So those things add up over time and if you go to one of these sites and you put in your name you're going to see all of your unclaimed money for ever now. I put in my name. Unfortunately I didn't have any unkind money for me but I put in some of my family members names and one of my uncles has four hundred dollars coming to him. One of my aunts head to records that came up and she's getting like two hundred and forty dollars back to her. I saw one account on their fourteen grand of unclaimed money. And I'm just like wow again. All you have to do is go to unclaimed property and your city name put in your individual name in the search field and see if you have any unclaimed money for instance state of Louisiana in itself. The Treasury's Office is holding over. Eight hundred seventy nine million dollars in unclaimed funds or if you don't have any unclaimed funds I'm pretty sure that somebody who's arms length away has unclaimed funds and you'd be making their day if they see that they're about to get forty dollars into their bank account or forty dollar check in the mail so again quick tip to find some couch money and maybe even help you through these uncertain times. Hope you enjoyed it. Let's get to the show and now your feature presentation. I come from a background of cattle ranching oilfield in Wyoming white off the cattle ranch and from there to earning heavy equipment than identity to work in the minds in northern New Mexico with my dad and he'd been doing that all his life and are at least a good chunk of his life except for the time cattle ranching and I that opportunity phenomenal to me to be able to be underground with my op. Heard about his experiences and the people who work with and I was a kid and so it was a great job. Great Opportu my favorite job in the world. But they had to shut down the project. They can only go so far and I got laid off so I had to go look for work and every place I went I got turned down because I was too obvious. Overqualified for every job. I could find Every opening available and I found myself one day at a wife and infant son. We were completely broke. I was applying for a ten dollar an hour truck driving job with a landscape materials company. I got turned down again overqualified. I drove away from their literally shedding tears. I was I was a broken man. I was only twenty three years old but I was. I had a great resume. Could not understand why couldn't get a job and as I drove away. I had a coupon for diapers for my son because we were added diapers at the House. And as I am driving up to the grocery store actually leaving the the facility. My Gas like comes on my truck. So I drive over to the store where I need to go. There's a gas station outside their pulled up. Swipe my debit cards. I have a credit card and I didn't cash and I got a decline. I rummaged through my vehicle to find some change. I started walking parking lot for two hours when I was done finding enough. Change to get two gallons of gas so I can make it home. I went in to get the corresponding diapers with that coupon on my way out. I face to face with a guy used to do When I was digging swimming pools years before he used to run the office and he asked me how things were. I told them what was going on. Get a gift certificate for Red Lobster took Nemo to dinner the next night and introduced to this industry giving you the business card for a guy who ran a broker shop. Introduce me start as telemarketer twenty three years ago and I've completely my guts out for twenty three years to get the coin format today. Walk me through the transition or not. Think that's really fascinating. So he started as a telemarketer. How did you climbed the ranks like Position Position Walk me through that L. Sizes when I walked in their head to cut off my hair shave and clean up. I come from a rough neck backgrounds. You Walk in there. My Mom had bought me some clothes so I could so I can look like a business guy is a very relaxed atmosphere and as I was learning how to do the telemarketing I developed. Some some leads and I was able to convince my branch manager to allow me to work some believes so he said okay. If you WANNA work this I'll put you with one of these other loan originators and he can teach you how to do loans. But YOU'RE GONNA share split. The Commission on your first ten deals it was really kind of hammer and chisel process trying to learn and adapt to it. But I I started recognizing different personalities within the brokerage. And there's a guy over there in ED in. That guy could get away with saying anything anybody he'd get away with whatever you. WanNa do still be fairly success for in back in those days. Successful was closing three or four transactions a month that was a successful person in the industry. Your closing eight nine ten. That was huge. Well mirroring myself trying to figure out who I was to be common. This and having the balls to just be that person as I developed understanding of the business just getting out there and really communicating to everybody and finding my niche eventually stumbling into the real estate investor from a loan originator. Just doing any loan. I can get to the point of up something. I'm no longer focusing on people. Buying houses I'm older folks. You know working with realtors. I really couldn't stand it. I no longer folks on working with with home buyers to buy know their first home of their dream home because what they were. Purchasing was irrational. Most Times they wanted something couldn't afford a push you to give them that because they're rising American but the real estate investor made sense to me so I started develop my understanding of the real estate investor and real estate financing. Why they were buying those homes how to do the cash or how to find the light right loan programs that help them and in two thousand three ice when fulltime chasing roasted investors and I started ignoring all the other things and then the crash happen right. The people are sending my business to business. Got Out of the business in August. Eight to two thousand eight on a Harley heading out of town and I've gotten a motorcycle wreck the put me in a wheelchair and completely changed my life The dynamic of everything at that point So I came back to an industry that was obliterated. Learn how to walk again at a literally. Retrain my brain. 'cause my memory my memory. It only lasts three minutes and a return everything but it was one of the best things I could do. Because now I had to learn all this stuff all over again and it actually became the best thing that ever happened to me and I really really dug deep into the real estate investors when they're coming into Arizona to bind that real cheap real estate because of the crash and at that point I just had to really mold myself into becoming The trusted adviser to those investors from a financial perspective. There's an old saying says says good judgment comes from experience and experience comes for bad judgment. I am blessed to do Between seven eight hundred transactions a year this year will probably get about thousand twelve hundred and I get to see a lot of judgment making skills at work. I can see a lot of people deciding what they're gonNA do their business and I get to see where they fail where they succeed and because of that I can advise the investors I work with based upon what I see other people do and were their successes so that way they can they can avoid the bad judgment needed to build their business and then I realized that and I start becoming very very very interested in the of the real estate investors business. My business went through the roof. I went from a couple of hundred transactions year like I said now over seven hundred in fact we. This month will have closed over four hundred by the end of this month. So far this year ascribable baron. That's simply amazing. You know taking it back when you didn't have the best memory. You're losing your cool. Remember things past three minutes. You know one of my favorite exercise. My favorite memory exercises is the mind Alice. I'm curious as to what types of exercises. What was your favorite at the time to really help you sharpen sharpen. Your memory was carrying around notepad. I'd write down everything that was going on. I had some very very patient where people working with me. My mom is still a realtor. She has a real to then should send me a lot of business. There's another guy here. Kobe corn and Caroline. She would similar business they would call up and give me a client to call and then five minutes later calling me back say. Did you write that down? I'd say right? What down and they said. Grab your pad and write it down and so it really boiled down to people who cared enough about me and my family and my future to help hold my hand and I kind mostly thinking about it because the other people took care of me to make this possible. Of course I had to get off my ass and make it work to know because they weren't GonNa drag me right. They were going to prompt me and I started to do the work. We just writing it down in rereading it reading reminding myself I need to do. It's like that movie memento by entering mind myself now as a kept after that eventually I didn't need to know pat anymore by down to a habit of carrying one and keeping notes on what I needed to do and eventually they'll be able to build a business record. Hire other people to do these things. So now my might. My whole one is to make my investor successful in to have so much business. I have opportunity for others. So Samantha scheduled us Her whole jobs read my emails schedule. My calls and make sure my calendar school and it goes if I start touching it all screw it up so I You know it the the blessings of come from my inability to do certain things or my ability to hand off certain things to bless other people's lives people often say you know you should. You should get better your weaknesses and oftentimes find a successful people. Focus on their strengths and weaknesses. We consistent have other people focus on at any time. Do you wake up. And why four. Thirty in the reason we can before three sometimes. It's earlier than that what I need do. There's been commonly lately two. Am To thirties. From their the reason I wake up at least a four thirty is because I started morning routine. I dropped to my knees every morning. In prayer to offer grab a prayer of gratitude to God for the people that are in my life the clients that I have every single one of them I get so many new things to be grateful for every single day the opportunity to be on this show And the people get to work with my family all these things right so I get to. I start with that and we go to start my coffee up and I go right to my chair. I have a specific choice. Sit in and I start reading right now. I'm in Second Samuel Reading about you. Know the life of David in the Old Testament. I've been reading all these books. The couple with the Old Testament to understand it better. A lot of people get into the whole separation of Religion River. In in my opinion is not religion is the history of us is the history of where we came from and what happens to people who choose the wrong route and what happens to people who choose the correct route and you can decide for yourself. It's just a it's just documented understanding of humans. Right then from there. I studying what I need to day. I'm also an author got four books out. I've got three more written in with my editor. I've got I'm I'M HELL-BENT ON TEEN BOOKS TO GO OUT by the by the end of within five years and they're not big books. I got four of them here. They're just they're little. They're only thirty pages or more. And the only reason I write thirty pages or more because I think if I try to go for two hundred one hundred pages. The message gets lost with all the filler. I focused on the specifics of that particular item and then the And then I get out of it right and they go on to the next subject and so I spent some time doing that. Then I get a workout in. I start my day absolutely exceptional. You're currently ranked fourteen in an industry with over. Three hundred thousand loan originates and you. You mentioned that you were set so probably close about one thousand. That's four hundred laws this year twenty eighteen. You call seven hundred units in twenty seven. Can you call six hundred seventy units? How in the World Aaron how in the World? This is the kid. Grow Up to this entrepreneur and this entrepreneur a marketing funnel literally able to close. This month deals hottest. That happen it's It's Kinda hard to wrap my head around when people ask me to define it and boil down to is you know had to restart my my business a couple of times and up until November. First two thousand fifteen. I couldn't get past a hundred and some and the November I. I had a partnership. Go Bad we. I actually merged with a with a competitor. We're doing awesome. He decides we're done and he thinks the plug and to start over at zero what I had was you know. Three Staff Members. We sat down. So what are we? GonNa do with that. Next phone call comes in and we decided that point. We had all this knowledge that we had had from what we developed at the up to that point. How do our jobs? But we didn't have as a really really awesome system because I was always combating with my partner and how he wanted it done versus how I wanted done and I stumbled into what really helped most was finally starting to start reading right at a buddy of mine share with me. The book the goal by Ally Rat. I've ever heard of that But it talks about manufacturing and what I did I took lessons. I learned from that and start applying it to the the the now business basically starting over with the next phone call Samir. My little staff sat down and talk about what we do at this next client and we started enacting a process of comic going aaa get a Burrito built. You've got a different person doing different stages seeking efficiency in everything because the phone was gonNA ring. I still had a reputation and it did. It rang within ten minutes and capturing and because of our focus on what we can do for that person on the other side of the phone. They are the most important when I got that. Figured out at this point the partnership split up you had already niche down to specifically focusing on Investors yes. I'd niche that outbreak in two thousand. And three right but in he was a competitor of mine in that Niche. There's only like five people in the United States. Do what I do you know. And we're all none of us are really competitors. Brunell competitors right as you're going to deal with the different loan original based on who you're dealing with weight you're seeing is what you get right here with me right. I'm always got the damn hat you know not. Very many people are walking around with a two and a half beard right. There's there's GonNa be differences not at not all those Voelkel as I am. You know they're not going to say the shit that's GONNA come out of their mind. How's it going to matter? There's right so with all that I knew I had a certain following and I was really really hell bent on creating a cult following which is what we've been successful at doing but all boil down to. What was the experience of that next person and then I started talking to them and asking each one of those clients. When the deal was done what do you think we can incorporate in our process to make us better what we do? I started doing that for a couple of years and I started getting a lot of feedback and so I talked to my teams like how to incorporate this. What are we GONNA do? What are we going to change? And we have slowly built from me in three team members. I've lost some team members and gain some more. I'm at twenty one employees right now this part of my team. The only folks on the deals that come through me. I've got processors processing assistance underwriters. Funders closures all my team instead of me talking to different departments and having to convince a different manager to help me out and prioritize my stuff. They all work with meat. It's freaking awesome. No so it really just bow down to deciding what it was that those individuals that work with us need to have the more. We focused on them. The more our business just grew and It's not about it and we and we actually really shook off us. We didn't care about us so much like I ask a lot of people who made the most money during the gold rush is the guy who sold the picks and shovels neither people digging for gold. There's a lot of people need a lot of money. Digging for Gold Toe supervised into tools. So what I explained to them like. I'm selling picks and shovels but the difference between me and those guys back there is. I know where the gold is. How to extract the ground? I WanNa give you all the best information because not because I've done all a bit because all the people who are coming through my shop all the time and if I can help you to find where it's at get it all out of the ground you're going to need more than picks and shovels you're gonNA TRUCKS. You're going to need heavy equipment. Needed a smelter mill. You'RE GONNA meet a damn train to haul that if I did my job. Who could come into for all that? That's going to bite fixing shovels from Megan the equipment so their success is my success and if they fail. I start to fail in bottom line. I don't participate failure. I will not set people who's going to take from them. I've seen a lot of people out there willing to take from another person for their own success in time. I've seen they end up falling anyway. So why not just help them? You end up helping yourselves and you never end up having been a situation where you're defending yourself. I'll let the airlines beautiful analogy. I totally resonated with that. When you think was the cost of what you call it. A cult like following. What do you think was the cause of that? Was THAT WAS. A loyalty was compassion. I really I'm guessing if I had to really yes. Something has to do with the fact that I care enough cares much for those more more for those people on the other end of the phone. Then they do for me. There's that old saying and it's very cliche. Nobody cares and we cares what you know until they know what you that you care something to that effect remember executive members on a mug somewhere coffee mug but it. It really is true if you don't give a damn about them they don't care what's going on your head secondly is I get. I'm present in a lot of places you know. We're talking before the show started about my travel. I speak a lot publicly When it comes to real estate investment gatherings and and seminars or whether it be events that they're having and when when before people had seen me very much only got on the Internet in the last year. I've really tried to stay. Keep my keep my physical presence awaiting for the public. I want people to decide who I am by. My appearance will then would end up happening. Is I go to these events and people were being told they've got this real estate investment finance expert coming in to talk about the markets. You talk about finance talk about inflation to talk about how the inflation nullifies compound interest that a lot of information to give and so when they're they know that person's coming and I never give a head shot I used to never. Let's put it this way and people like. Why don't you give us a headshot we need to give like? I don't want people to make an assumption what they're going to get out of the gate so when people show up and they get that introduction to get my background and are sitting that audience and then I come up on the stage looking like me of jeans pair of boots that black dickey shirt on in a steel chainsaw hat with a braided beard. Like one the hell. Is that Wisey here. That's what I'm going for. They have to ask the question before the here. The answer right so the question comes up saying what the Hell is that. They got a now. Listen to find out what the hell that is so I think that the cut like falling really start even a develop even more when I had the opportunity to have these these These chances to speak in front of people and that was not easy to do. I had to develop enough knowledge to be credible and once I started becoming credible enough to get in front of people. I've been standing on stages since two thousand twelve probably because of that and intermittent till now it's quite quite a bit quite a bit more often and because of that People were really intrigued to the fact that how is it? You know all that you look like you. And it's such a dynamic shift of what was going. On in their brain they gravitate towards those conversations with me more so than the guys who look like everybody else that blended in with their Polos or their or their their sport coats and all that crap. Now God bless you for wearing them. You're not gonNA catch me dead in effect. They're not even allowed to bury me in that crap. Put me in my camoes. I WanNa be a going onto a great hunting grounds of the of the next life. But I'm glad people wear that stuff so that way they can. They can go be there. And I can differentiate myself I love. I love this isn't a fascinating conversation already. I WANNA get Some learning and teaching our audience. Today you know you. And I share a favorite one of our favorite movies. The big short his snub talk about the Highlights really the the real estate bubble back in two thousand seven. Two thousand eight and it was entertaining but also educational yours lots of educational which I really enjoy again. Big Short definitely go. Haven't seen that movie out while Orienteer- right now on but I want to talk about some of the things talk be Detroit and see if we can break down on you some of the things that are on a lending industry but I can't we some background on some of the Terminology. Office on a ask you what is mortgage back security and what drives interest rates. So that right there. The big short is one of the main tools. I used to teach people what that is. So when you when you watch big short there's GonNa be a character under from Solomon Brothers back in the seventies luminary. You're gonNA see a scene where he's standing in a conference room with about four people and one of the people sitting at the at the end of that conference room that he's presenting to. He's got one of those overhead projectors winnowed seventies right and he's talking about this thing the mortgage backed security what they're doing is they're taking their convincing a pension fund manager who is who is presenting to to take twenty plus million dollars from the pension. I think end big twenty five million total. If I remember correctly I didn't go back. Look my numbers But they were going to invest that money into this pool of funds and then what they were going to do is take those full of funds and make it available to the banking industry. Take from to lend out. And they're that security. If the more money goes into that pool it's supply demanding right the rates go down the less money in that cool. People sell out of it and go to stocks or precious metals or other commodities or currencies to wherever they invest their capital. As it shrinks the rates go up supply goes down cost. Goes up right so what he would figure it out is waiting. There's all these out there that take depositors capital and they will have a loan officer in the bank president and they will learn many out to to the local people and they will charge twelve percent fourteen eighteen twenty percent at some points and they will keep a portion of that. And they'll pay their depositors like this like their CD owners like eight percent will pay the people checking accounts like two or three. That was back when you're making a decent return but also inflation was through the roof as when you think about it really wasn't a bounce themselves out so what he decided was like. Wait a minute if we can get you know. Eighteen twenty percent when you take all this investment capital from pension funds and people's 401K's in IRA's and we'll pile into one place will ended out as the money comes back. We'll keep a piece. The Pension Fund keep appeased the end user. Who put the money into the pension? They get a piece so there's billions of dollars being made overnight. These big pools what happened. Was You get into a scene? Where Margot Robbie sitting in a bubble bath and she saying you got to a point where people you know there was a there was a time in this nation. We were content with what we had. He wore out there. You know by living in a house for two years now. Oh I now I go by the next biggest thing. I would be the king dangling on my street now the biggest baddest house in the fastest free car right people were happy with what they had. I mean there's a lot of folks I knew that. They bought their houses in the sixties and they stayed in the same house until he died right. That was part of the human the American culture at one point. So what happened was they're running out of people to lend to so they had to get a little bit more creative. Then you get to the late. Nineties started doing the zero down stuff you start doing. The income qualified stuff the The no income no asset the real crazy kind of loans and then used you see them putting our whole industry at risk our entire actually as the global risk because people were giving money to borrow that couldn't afford to pay it back and they're being told it was fine you know so there was a lot of We got into an earlier. Talking about people are taking advantage of other people that was people taking advantage of another person in their ignorance of what they could afford what they couldn't afford now. We had the crash. Now we have a lot more of a responsible lending process going on the licensing. We have to go through. That's miserable at twenty. I think. Twenty four twenty five licenses. The renewables is sixty hours a year. It sucks but it's necessary to ensure that the best people are still in the industry ensuring that people are not being taken advantage of now. I can't say that that's happening. There's always human human nature at play but understanding the background. The mortgage backed security. What drives interest rates is an absolute necessity too often? People think the Fed lowering the rate is GonNa Change. It doesn't all the Fed. Lowering of the interest rate is as illustrating our current economy. If they're lowering the rates is because they're trying to spur some happenings within the economy. Trying to get things moving right. They've lowered down to zero. That shows how badly they want things to move. And that's an overnight rate between banks. The other thing is people wash tenure treasures. Go all the treasury's well. It's a ten year note right to ten year bond and that is the treasury goes to the government. They get to use that for what they're doing. They're paying interest. Whoever put the money in there will one big indicator that is not tied to mortgages most of our loans? Today are thirty year fixed. That's ten year. How is having money coming from tenure instrument even remotely related to a thirty or instrument so got go towards being done? I tell a lot of people go to a site called Mortgage News daily Dot Com Slash M. B. S. mortgage backed security. And when you get there there is In the center of the screen there's GonNa be a graph that is the mortgage backed securities trading. Now you're real estate investor you want to click on in in the middle of the screen. They'RE GONNA see a thirty year U. N. B. S. as universal mortgage backed security. Then he's GonNa show a number probably three point five. That's the coupon there's various different coupon starts. I believe two point five. Three three point five four four point five five five point five and six. Those are the different ranges. Were really dealing with for an investor in the in parentheses. Right next to those numbers you can see change coupon. Click on that. Go to four point. Oh that's GonNa mainly tell you about what's going on in the pool where we get money to for real estate investors as it trades up in the green and you're going to see green bars and bread bars at green bars is well. Each bar represents a day of trading. If it's a green on music traded up money went into it. If it's a redwood money traded down it went out as it goes up the pool start to swell the rates will go down as it goes. Down TO POST-PARTISAN START to decline. The rates will go up now that is actually cost per incremental cost per rate. If you see a swing. Let's say let's say today you're going to see on that U. N. B. S. four point. Oh somewhere in the range about one. Oh six point five. One hundred is par. Sixes is referencing yield. Now we're not GONNA get into the real depths of that. There's a lot of explanation there. So let's just say it's one. Oh six point five and you called me and I quoted you a certain interest rate right and then a week later so it's quite locker rate. It went from one zero six point five. Oh two one. Oh six point zero. That means you're going to pay about a half a percent because you got a fifty basis point or point five point swing in the pricing or the market from the time that we first talked you get you could get the exact same rate but now the cost went up a half a percent. The other way around in the cost got better. So it's it's it's a process to understand it's taken me years to get it in his little nuances. We don't all get because there's been a major thing that's happened with the servicing side of the business. That's blown things up right now. People are GonNa see points where they never saw points before. Because nobody's paying the service these long anymore than buying the servicing they're demanding the servicing in. You Pay Them. So that's changed the dynamic. I don't know we can get into the depth here but understand the mortgage backed security. It's somebody's pension. Somebody's retirement is could be part of your your 401k as if you got a mutual fund. I'm pretty sure you've got money in there. So whatever they're charging and getting back is paying for somebody else's future one benefit to it. Is we live in an inflationary environment correct. What is today's rate of inflation? So the Fed will say it's about one to one and a half one and a half to two percent. They're basing it off of and we got the new the new PC coming out. I think today the personal consumption expenditures index while they measure inflation. But they're only measuring things. You go to a place. Called the chaptered index dot com or shadow stats dot com. They will show. Were probably closer percent inflation seven to ten your northern California's thirteen if you're in New York is like twelve. You know so. Inflation is based upon the cost of living. Where you where you're at right. We'll if the average Americans bein more stuff than what the Fed measures and those things are moving pretty regular. I mean look at the toilet paper index right now. You know you're going to find it. You're going to pay ten times more than it used to be. So inflation is through the roof on paper at least APP particular kind of paper so considering these things at certain products more and more every year these dollars losing its buying power every year so if you borrowed say eighty thousand today to buy a hundred thousand dollar property finance eighty percent of it many times people think man. I'm paying paying interest on that for thirty years. I'm getting my butt kicked by compound interest. Which is the eighth wonder of the world according to Einstein what things Einstein didn't talk about was having that involved with a thirty year fixed instrument and asset. Which is a home with one paying your Castro in to you get paid back over a thirty year period with a declining instrument like the dollar so if the dollar lost only say seven percent per year because you're keeping yourself wired tight not spending money indiscriminately. You're being conscious about where you spend it when we calculate every time you're that dollar that the money leaves your hand to make a payment for thirty years. Three hundred sixty payments longer paying him three or eighty thousand not paying the seventy thousand dollars in interest. If you calculate the true value of the dollar as equated to the the eighty thousand dollars a day you borrowed it. You're paying back sixty two thousand in change. Based upon a seven percent inflation rate so I tell everybody leverage high leverage. Long payoff slow. The greatest asset to your business is a thirty year fixed. Conventional lump how long it takes you. Give back the money a love that well and you hit us a whole lack. I know a lot of our listeners. Suppressing rewind by thirty seconds over and over and over again because it was a last night nibbles all. Good intro on. I think that you know to kind of pro ball on that. In terms of how what the listeners now looking at on certain level in a lot of investors trying to figure out over the next few quarters is what should they be thinking about finance where looking at Mitch is right now. What should way should be is. What is your outlook? What do you think investors should be doing right hander? Spirit during this period. Several things number one store getting your morning right. We talked about how I start my day. If you're starting your day like that you're not doing something with yourself. You better start figuring it out if you had a commute before that you don't have any more so now you sleep in. I would change that habit right away. We are forming habits right now. The habits of humans have changed completely. You know they say of takes. Eighteen to from eighteen two hundred days to form a new habit that sixty six of consists sixty six days of consistency to have integrated towards where? It's just an automatic happening in your life. We are creatures of habit we were. We're going to be the slaves to those habits so formed inhabits and become their sleep start starting with the morning routine. Get your mind right. The others did a baseline of what deal has to work. It doesn't matter what the interest rates are a truly doesn't the deal either. Works or it doesn't I was doing loans back for people in the interest rates. Were nine percent and the deal work. I'm just doing loans for people in the interest rates are at their all time lowest of four percent for twenty percent down and the deal still worked it again either worked for the benefit of interest of the real estate investment world. If the rates are going up we get to write things off on her taxes to offset it. I have a whole other story. Where a Guy Pot two houses? I'll just tell the damn story. He got wounded contract onto brand new build homes of Memphis Tennessee. Same floor plan same price. Same potential rents same street. The only difference was one had the door facing on one side of of the garage had the other and then the other one was just about done being built the other had yet to break ground so he was in contract on a law when he finished on propping number one it was December of two thousand seventeen. He had a four point. Seven five percent interest rate was very very happy. Cash flow was was working. Well he closed now. We have jerome. Powell is the new chairman of the Fed. He started quantitative tightening. No quantitative easing. What is the Fed dumping tons of money in the mortgage backed securities keeping the rate down? Quantitative tightening was the Fed stopping putting money in there right when they did that by may the next year the interest rates went from four point. Seven five to five point seven five. A full percentage rate different when I quoted him on his new rate is that I think I'm going to cancel the second deal. Acquire you cancelling. Who's I'm losing six hundred dollars a year? That was his words. Like how you losing six hundred like the differences payment is forty nine dollars and ninety seven cents per month averaging out the fifty bucks a month. That's six hundred dollars a year. Okay how is it? You're losing it though? 'cause I'm putting out the same amount of money out of my pocket. I did on property. Number one number two is paying six hundred less. So it's not worth it to me like. Well you just finished your taxes. Right was yes to contact your. Cpa and ask him a couple of questions for me said okay. What's that I said? So before he make the decision ask him. What is the difference? You will pay in additional income property one versus property to then which is six hundred dollars year right. Then ask him. What is the difference? The tax deduction you get on property to versus property one because as higher interesting charge and then get back to me and then remember you're even paying me interest your tentative right tenants paying the interest. You're the cash flow and you get the right us. He comes back to me so go ahead and closed. I said why are we closing 'cause when you run the difference in those two scenarios based upon my taxable income. This last year goes no the differences no longer forty nine dollars and ninety seven cents. It's three dollars and fifty five cents per month. Let's close the deals. The the the lesson here is it doesn't matter what the interest rates are. We have we live. We are the most tax favorite asset class on the planet. You get to make money because somebody's paying off right. You're automatically growing your twenty percent to one hundred percent. There's somebody else's paying down the eighty percent. That's that right there if you run the math on that and that's a thirteen point. Three three percent gain every year on the twenty percent. That right there kicks everything else has asked before any other cash flow right casual. We get one. We get to write the tax deductions. Then we get the the Inflation like we just talk about just pounding compound interest death in your in your behalf. We that growth you never even paying back the principal when you consider all the things potential growth into in the value of the home. We know that that's that's happening. All season return is hundreds of percent return too often. People get caught up in cash on cash. Return what's my cash will. Those are all necessary to quote the big short necessary on top of the Sunday. That's not the ice cream that's not the whip cream that's not the nuts and that's not that's not the sprinkles that's just the Cherry. The cash flow is the Cherry. Everything else it just talked about is the hundreds of percents that is the Sunday. That's where you focus your time at. That's where you focus energy. That's where you focus your your your investment thought process in pray the Cherry just a big big big sweet one. When it's all done mentioned the call that you had a few trips council enriching some Senate senators just around the ideas of the leading industry since May report which shares on their last year. I was invited as delegation to go in and speak Several and in the conversation. The one I wanted to really bring up is there's a big worry about housing right lower income housing they. They want to allocate more budget from the tax dollars to build a towards lower income housing nor trying to explain to him. You just don't realize there's billions of dollars floating around in the wings in the forms of private capital in the real estate investor so when they come into a neighborhood and they see the possibility picking up one property tearing it apart. Rehabbing it making it a very very nice home for the renter putting somebody in there right going through the process of evaluation. Making sure they're getting a good solid tenant in there then they do the house next door and the one on the other side and they slowly work their way through a neighborhood bring up the value. The neighborhood right. You're providing housing for people that are that are not able to afford to purchase it. This time you're also improving the quality of people within the neighborhood right getting the crime out because they're not the ones paying rent so you're slowly improving these neighborhoods. And then if we work out some sort of pass for the person occupying that structure can purchase that home from them in the form of a refinance. Because we've created some sort of instrument that gives that person the ability to kind of like a like a lease option used or could but haven't more legal teeth with Fannie and Freddie and all the government entities across the country in states and municipalities. That could change the landscape of but completely if they would just think about it a little bit deeper and stop looking at the real estate investors villain who's trying to take advantage people. It's not what we're trying to do if you're really understood the real estate investor and what they provide to the community back better so I was trying to bring a lot more light to that so I went there with a lot of people do a lot of private capital. I was the only Conventional Lender in the room and I was very very blessed to get a lot of the time when in those rooms. It talking with these guys. I want get a get a big red neck with a braided beard in a black suit. And they're they're going to look a little bit cross eyed at you at first then you get the talking offering the information. I got a lot of great feedback from but now we have all this other stuff is supposed to be back out there this year. The Corona virus thing happened completely Impeded our ability to go back. I'm not done I'm GonNa go on. Keep kicking and screaming and screw end in yelling and behalf of the real estate investor because there's a segment of our population is not being seen for what they really are and I find. It's my responsibility to do the best. I can make that. We all need to all of us need to be put out there. Unfortunately those of us who are trying to build our businesses were head down working. We're focused on trying to be good solid contributing members of our social structure. And there's others out there who are not to have a loud mouth. 'cause they got time to be loud now. We got to open your mouth up more so when you all with Congress what what is what is that solution on on on the other end so that would be some form of instrument that they could do that would like we're kinda rafting tying into a current loan of investor has alone and they got a thirty year fixed mortgage with you know. Fannie Freddie that I like I'm doing here and then you have a tenant in there that qualifies in certain way that we can create an instrument. I've got I've got kind of a pilot instrument. We can put to work in a couple of different markets and see if it works that would attached to that deed of trust or that that that Attached to that note if you will does not impede title. They don't have ownership yet. They have rights to it and then because of that have the ability to refinance a home into their name. Then you have to go through the sale process and all that that would be I seek would be awesome if we could pull it off now. There's a lot of legal gotta get to that. I know a lot of closing attorneys multiple states. Talk to that. We could come up with a way to do it if we got that. Government thumbs up to building move forward. The problem is you know not all of them. Look at it the right way and the other things. They don't even understand us then really know. We're out there when I was in there. Talk commenting on it. Derek would we know nothing about this because they they're they are big big big fish to fry and I don't envy the job whatsoever but if we can get a lot of the the the attention it needs to be. I think what they're worried about. Low income housing l think it'll all be solved but we at least have you know we can take a dent. Could've done that sucker if we get enough backing when Investors are looking out three months down the line again. Now we're being offered firm units modifications all these different types of things. We've been doing a your business to overcome this crisis smoothly as possible. Have you been having conversation? Tenants have been at you. You suggest the People that are us go and talk to that rendering and see what their options are like. What are you kind of waters right now? So number one is in taking very very vested interest in each person. I work with and helping them to understand how they run their business. Because it's a truly a business right the people that I've seen the had the problems in one. There's not a lot of people not paying the rent. People are paying the rent in fact. I've heard some property. Managers saying their collections. Up from what they were before the crisis so very interesting the other is if you run your business accurately in a run it right in your setting aside reserves not trying to take your your your reserves to have Your Business Tessa or your business retreat going to three times a year to get your mind right now is taking from Your Business in If you're listening to this as called embezzlement is what that is. You're taking from Your Business and not setting it up properly your embezzling it for personal purposes. Quit that crap. But if you're setting up right. GimMe right reserves. You'll weather these things whether these fine if you have your basic principles in order you will weather just fine but if you really need it you lose your job. Tenants are paying that you have the forbearance to fall back on. But you don't do it just to do it too. Many people concepts is that a great. Is that a great message that I should use to be able to develop reserves forbearance four months. Set the money aside than having put on the tail end. They're not going to put on the tailing doesn't work that way. You'RE GONNA go four months payment on number five. You can pay all those payments in five months. That's going to suck and sitting. Your bank account is not going to make enough money to do that. It's actually going to hurt you and Harvey. You're going to get out of your pattern. Stay in your pattern in on the tail in. Because that's called a modification. You get modification. Now guess what you can get to get loans for a little while because you told the world I cannot financially handle my shit. So why are they going to put you in a position to get more debt? If you can't handle it handle it set it up front properly the other thing. I'm telling everybody with your routine when you start getting at the morning. Get this called the master key system but Charles Hamill. If you've never seen it you've never read it get. It is what teach you how to think so. Teach you how to get your brain wired right stink. I've got flags all over. It marked the crap out of this day and feed them. See All the marks on all the underlines. This thing is amazing. It's not just a book you read. It's a system. He was a It was a correspondence course. In nineteen ten he would send people a letter to three pages. You'd read that letter everyday over and over and over again for a week and do the mental exercise. And then when you're done with that you go to the next stage of training your brain on how to do what you want done. Quit leading stuff in there. Tony. You can't do. This will teach you how to do what you can. Do you know if you know if you've ever handled chainsaw before by believe is most powerful most elegant coolest tool ever created. You can cut down trees. You can make a cabin with Carter Swan if you're talented enough. That's also most dangerous. You must use it for a second. It'll Qilya so why. The pats ahead head because it sits on top of the most elegant most beautiful and the most creative tool ever created in in in the world which the human mind. That's why we need this to be able to take care of properly but it's also most dangerous. If you use it incorrectly it will destroy you and everything around you. So I'm reminded every time. Put the hat on. I've got five of them every time. Put the hat on my mind right. And there'd be ready to be doing the right thing when you feel overwhelmed or unfocused vauxhall separate villas. Oh you're starting to waver from your beliefs What do you do in the helps? What questions you ask him so he had to rewire all. That's what doesn't do that to me more. I spent so much time folks on where I'm heading that I don't even allow that doubt creeps in but it doesn't mean it wasn't there before There was times man member my career. I was literally losing it and I was about ready to physically implode I had to change. My environment is said to get. Wherever as I'd get up and move I had to go somewhere else at on. My wife says she just take off. Stand the grass get a different sensation. Change the sensation no end. If you let your mind starts to wander often established start creating All the worst-case scenarios. It's amazing how you end up there. What your head right. Get your head right it. You get to where you believe it in. You think then you believe in your heart follow then your ashes goes there if you start moving yourself. They're always move toward the goal. It's GonNa be hard is is gonNA suck. It's going to be really tough to climb up just like going up Everest. Interestingly enough people trained for years and years and years be ready to Climb Everest. They finally climate. And how long do they get to sit on the top of their goal not a time? Fifteen minutes Edmund. Himself he stood there for fifteen minutes. Quite because kill you. Don't sit there for very long. You get your ass down you go for another goal. My wife did instead of creating Everest of setting my goal at X. amount or I set my goal so damn high on never reached the top. You know my what. I'm striving for is what I call lending Tokyo a an environment in lending that is perfect as far as the environment that took. I do what we do our job. And I know that I'm getting close to having the perfect environment with all my staff and how we do things but I also know for a fact I will never find myself inside the walls of lending. Toby when these days I'm GonNa be dead outside the gate 'cause when I go to the grave I'm coming in. I'm never stopping and I think everybody needs to have that same mindset. Set Your goals so far away that you will never ever ever get there. But you're going to be on such a cool path that you're accomplishing so many things that you're gonNA at least recognize how close you're getting and it. Kinda sucks a little bit. Say Never GonNA reach your goals and I never want to ever want to be able to sit in my chair and CEO have made it because then guess what I'm dead at that point so The the demand I guess the answer to the Question. I know around the the hill a little bit with that the main answer. The question has a lot to just changing your environment. Don't let sell your mind. Get sucked into things. There's a there's a guy out by Dr Joe Dispensing ever heard of him. You're seeing this Ted talk into coma Washington or HE SHOWS REAL TIME. The brain has you think as is connecting neurons in the firing on another. Ron's it's amazing thing. There were negative thoughts create a whole new connection positive thoughts create a whole new connection you can actually rewire old connections. If you concentrate. You GotTa Watch that. He explains it in such such an eloquent way to understand. And once you understand how your brain works and you understand what you're doing when you're actually thinking thought and how it's rewiring things. It changes your mental thought. How you go about thinking your thoughts. You realize. Wait a minute if I connect that neuron now. I'm going to be thinking that way and I wanNA think that way. So then you physiologically know what's going on instantaneously in your head so you change your thoughts. That's basically what you have to do. If you don't like what's going on inside their change it I know sounds simple and I'm saying it simple but it's gonna be hard at first you have to create new Orrin. Watch that Dr. Joe Spends a ted Ex Tacoma just search for that Youtube and watch. It's amazing what he's telling you in. Watch it three or four times get. It did what he's talking about how to control your brain. Get the master key system. Learn how to have to to control it. I'll put that Al Quebec Link can be Sean as well and just because we've been throwing out Sony amazing books on this upset also throughout his book as well but I read. That's amazing just concede bought fact lifestyle design acceleration. Hank's is your favorite. Before the millions that has to be the absolute greatest asset in my life. The second best after that was Napoleon. Hill's outwitting the devil. Lavender the master key system. But I love outwitting Sir. What is your favorite lifestyle design act? This can be a business or tool. You know. I'm I'm one of those the best the best app I got with my texting. Text People's need this handle right and the the ability to communicate with my clients post closing actually way behind right now. I'm a month behind on anymore. Just be able to teach my texting. Hold the microphone down and have a personal message. Go out to each person I do business with. That's my favorite. Because they get to hear from me and the Exercise gratitude share with them. How much I appreciate the trust because without that I don't have anything I love it. What do you enjoy most about the way? The lifestyle is currently designed the opportunities that I have been blessed to create for other people. I've got twenty one phenomenal. Employees are amazing people and they are all pulling their hair because they can't keep up with it. I made a promise several years ago. When I brought somebody from the from the service industry she was bartenders. She was amazing. She's part of one of my main team leaders now and she made me a promise years ago that she never has to go back. And I'm blessed to be able to fulfill that and so That's that's one of the things I really really really enjoys. Being able to give other people opportunity and apple in also the opportunity of real estate investors get in the conference that they haven't compete building their portfolio. Because they know they have a battle hardened partner. There's not gonNA stop until they're successful sauce. What were the sacrifices that you knew you had to make before the millions to get to where you are today One of the big sacrifices lack of income you know when you when you look at going from a job where you're paid hourly or salary two hundred percent commission back in nineteen ninety seven and then having to sometimes you you were sixty seventy hour weeks and not make a single dime for two three months. That's happened remember going in on Christmas Day. Nineteen thousand nine hundred ninety eight Christmas Day to meet with a husband guy and his son. They were living together on refinance on their house. And that was the only deal is gonNA close in January. Got The closing docks to the closing table you know. They were with another lender for an eighth per cent lower interest rate. Never communicated to me you know. So there's that there's the nights that I was just stressing to try and feed my family in a win. From you know many times were dead broken looking to having the guts to stay in it because I knew there was something better down the road and I gave up and I found. The numbers are to go back to running heavy equipment. Go Back to David. Swimming pools go back back to driving truck. You know because I was struggling that bad but I stuck with it and really. You'll learn a lot about yourself when you when you develop tenacity absolutely beautiful. Who was essential to your crowd before the millions? Why well it's it's a lot of people. Essential was really having a person. Here in my life my spouse who believed in me even know there was times it was it was so damn roughly had nothing. She knew that what I needed was the backing of somebody nagging at me saying get out there and get a job. She knew what the possibilities were. She backed me up. She stayed with me and believe me sticking with me is not an easy damn thing and then the other influences are the. Who believe me at my current I presented to them something that has never ever ever been created in this in the history of this industry and some of them tried to take advantage of it. They're gone there's others that back me up and realized that and they came in behind me full force and we went from few hundred a year to now push on one thousand one hundred fifteen one hundred thirty transactions this month. That's what the numbers are saying. Within the next two days it's unheard of. It's amazing I honestly I can't even begin to tell you would've feels like 'cause I don't know it feels like Tuesday anymore because I just not wrapped up in. That was gone the day I found my my my books Amazon didn't rely. I mean after I thought about that was actually a Tuesday. The best things in the world always happened to be on Tuesdays. That's a whole other discussion. I can get into our youthful. I love this last. Not least why do you think so? Many of us are stuck before the millions even though we have every intention getting the millions. I really believe that people are sticking themselves there's a difficulty of in- themselves what they can accomplish because he can't see it being done. That's where I think it's really important to sit down in a quiet place and right. What's possible if you don't write it down. It's not going to happen you know. It's where book number one in my in my series the Q. Jail Initiative as far as quick jerking off. Initiative comes in. I told people read that. It's the little things you can write down in accomplish if you have not could it down on paper. There's a chance that won't happen. So there's too damn much doubt in their own personal capability they had can have all the all the Facing the world and somebody else amazing how little faith we have ourselves. You'RE NO DIFFERENT THAN BILL GATES. No different than than Jeff Bezos the differences. They just did it longer and the endured things along. They fought harder for what they've got. It's not an easy life. Life is too I. It's it's it's hard being broke and it's hard being rich. Both of them suck as far as energy. Got Put into just gotTa decide which you want to deal with. Benign fascinating pockets. So they have a ladies and gentlemen Mr Aaron Chatman if listeners to allow a little bit more about you find out some Info on company or even GonNa Cox work might find some French go to Aaron beat Chapman Dot COM to as one R. B. As in boy. Now you can. Aaron Chapman DOT COM works works as well. But sometimes it's acting up so I guess give out Erin. Beach Dot Com. It's the tried and true on. You'll see a redneck sitting on a porch. What's really awesome about that porch? It's at my office in Missouri. You'd brick and mortar in that state and we're having problems. I flew out there. I wrote down something. That's the story in the book. I wrote it down and gamified end up right there when I wrote down two months and two days later. That's my office. Missouri cabin built eighteen. Hundreds you go to my website. There is a spotless. As of course Erin only three stories there. I should be writing hundreds but trying to find the time scroll down to the second one renewed from obscurity. You could see the renewal of the other cabin. There used to be a church in the eighteen. Hundreds mazing things out there. I wrote it down. I ended up with it and the other thing. I was writing to production. I'm going to go six hundred plus units. Now I'm way beyond it. It's amazing what happens if you down to write up. Go TO CHAPEL DOT COM. You can reach out to us through that schedule appointment. You can look at the media information in there. I'm trying to put as much data I can't help. I love your service. The pupil earned. This has been MAZIMPAKA. And we'll talk to you very very soon. I appreciate the trust.